12 Responses to “Macro economics of the real world”

Not relevant really to this post, but your big notes page is closed for comments.

Even some notable economists in the US (if Larry Summers can correctly be termed such) are questioning the value of large denomination notes, but accept any change would need international co-operation.

Harsh or true? (and somewhat worrying for the future of our children in higher education!)

Q. Is economics being taught correctly in universities?

A. Yanis Varoufakis

“No! I have spent decades, and a number of books, arguing that the economics we teach to students is as aesthetically pleasing as it is irrelevant. Put simply, the taught texts and models begin with the assumption that we live in a post-capitalist world in which there is no labour (as a process), no debt and, indeed, no… time (or no more than one person living through time). The models are fascinating. But it is like trying to do geology (e.g. fracking) by reading Alice in Wonderland.”

And I teach the micro-economics way (or meta-economics way to follow Schumacher) which helps my students understand why the government is so inept at policy formation in public services, i.e. politicians do not understand how organisations work, but they do understand power and control and view the organisations through that lens. Hence the top down, compliance culture with targets et al they enforce on the public sector alongside the privatisation drive, and the consequent huge waste of resources and people.
This helps students understand, for example, why Jeremy Hunt’s solution to the phenomenon of weekend mortality is to reorganise people, not to study the system. The best study on this by a doctor who is also a systems engineer posits that the most probable cause is the delayed discharges that occur especially on a Sunday (Dodds: Journal of Improvement Science). This is most convincingly displayed by some brilliant control charts of the arrivals, admissions, and discharges flow at a real hospital.
My students from all over the world love engaging with this system thinking. Would that politicians could. If Hunt had studied the flow he would never have caused the furore he has – unless, of course,that was his intention in the first place.

Hunt’s intention has always been to privatise the NHS, he even co-wrote a book to prove it. It is a tried and tested tactic by the Tory party; defund, demoralise, destabilise, deregulate – or sell off, whichever term you prefer.

Richard, if you haven’t yet spotted it, tomorrow’s Economist includes a leader and briefing that in effect endorses PQE. It supports (at least as options worth considering) fusing monetary and fiscal policy, financing public expenditure by printing money and more public investment. It is also favourable to wage rises.